The Effect of Price, Brand Name, and Store Name on Buyer's Perceptions of Product Quality: An Integrated Review

Journal of Marketing Research (Impact Factor: 2.52). 08/1989; XXVI(August 1989):351-57. DOI: 10.2307/3172907


The authors integrate previous research that has investigated experimentally the influence of price, brand name, and/or store name on buyers' evaluations of prod¬uct quality. The meta-analysis suggests that, for consumer products, the relation¬ships between price and perceived quality and between brand name and perceived quality are positive and statistically significant. However, the positive effect of store name on perceived quality is small and not statistically significant. Further, the type of experimental design and the strength of the price manipulation are shown to significantly influence the observed effect of price on perceived quality.

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    • "For example, Procter & Gamble, the highest spending advertiser, who has over 40 well-established brands, continues introducing and promoting new brands (Johnson, 2012). Well-established brands activate consumers' prior knowledge of the brands, which guides processing of the information content (Kent and Allen, 1994) and evaluative judgements (Rao and Monroe, 1989), whereas new brands are less likely to activate schemata given that individuals have few established associations. Despite the significant role brands play in information processing and evaluation, academic consideration of brand effects on consumers' reactions to model stimuli is scarce. "

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    • "Consequently, unfamiliar brands inspire more instances of negative bias. Rao and Monroe (1989) also suggest that as brand familiarity increases, consumers reduce their reliance on extrinsic cues and increase their reliance on intrinsic cues when evaluating brands. Thus, with respect to consumers' assessments of blame, the influence of the COO image becomes more powerful in the case of an unfamiliar brand. "
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    • "Consumers often lack the time, motivation, or knowledge to judge a product's quality. In these instances, consumers rely on available cues (e.g., heuristics) such as the product's country of origin (Chao, 1998), brand name (Teas & Agarwal, 2000), and price (Rao & Monroe, 1989) to simplify their quality judgment task (Simonson et al., 1994). Consumers are able to distinguish between high-and low-diagnostic cues, and according to previous research, price is a more diagnostic cue than other extrinsic cues in determining product quality (Herr, Kardes, & Kim, 1991; Lichtenstein, Ridgway, & Netemeyer, 1993). "
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